Beginning this week, American Medical Association and American Hospital Association representatives are expected to appear before a U.S. Senate antitrust panel, calling on Congress to vigorously examine the proposed Anthem-Cigna and Aetna-Humana deals, according to a Forbes report.
The appearances are not anticipated to have a huge legislative impact. However, analysts say "making a lot of noise" about a possible merger helped consumer advocates and the public put an unwelcome spotlight on Comcast's proposed acquisition of Time Warner, which collapsed earlier this year after increased pressure, according to the report.
Voicing its concern, the AHA has stated that proposed mergers between four of the five largest U.S. health insurance companies present "fundamentally different" antitrust issues than hospital mergers.
"The size, scope and enduring impact of the announced deals far surpass any hospital merger," Melinda Reid Hatton, senior vice president and general counsel for AHA, recently wrote to the Department of Justice's antitrust division.
She also said in that letter that mergers and acquisitions in the hospital sector are driven by the need to take on risk, offer integrated care and/or find financial stability. Despite these pressures, growth in hospital spending has reached historic lows, she said.
"[Insurers] will no doubt argue that the transaction would produce offsetting efficiencies, but this is not likely," Ms. Hatton wrote. "And it is even less likely that the combined companies would 'pass through' any cost savings to consumers. As numerous economists have found, demand for health insurance is inelastic, which reduces the incentive for large health insurance companies to pass through cost savings."
The AMA has expressed similar concerns.
"The lack of a competitive health insurance market allows the few remaining companies to exploit their market power, dictate premium increases and pursue corporate policies that are contrary to patient interests," Steven J. Stack, MD, president of the AMA, said in a statement. "Health insurers have been unable to demonstrate that mergers create efficiency and lower health insurance premiums."
Health insurers also prepare for battle in Washington, D.C., according to Forbes. America's Health Insurance Plans, the industry lobby, has a new team of lobbyists including former CMS Administrator Marilyn Tavenner as CEO.
America's Health Insurance Plans contends that insurers want to maintain affordable coverage by negotiating lower medical bills and shifting to more value-based reimbursement models. The trade group also has said hospital consolidation — not insurer consolidation — is undermining progress toward high-value care.